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Real-Time AML Offers Security in an Increasingly Risky Climate

Financial Crimes

Andrew Elliott



In an unstable economic climate, incidents of online fraud increase. For example, after the 2008 financial crisis, the FBI reported an 87% increase in online fraud. AML may not be a profit center for your business, but it’s critical to your security.

Real-time AML closes the gap between suspicious behavior among your customers’ transactions and the investigations your analysts need to generate. Plus, when you’re working with the right IT partner, you have the flexibility to incorporate real-time insights into your existing solution.

At Zencos, we offer real-time AML capabilities as a business continuation platform. We developed machine learning algorithms that accurately identify bad actors based on transaction activity or placement on regulatory watch lists. Rather than starting from scratch with a new solution, your existing AML solution becomes more automated, efficient, and cost-effective.

Real-time insights on AML and fraud benefits your organization across 5 critical areas:

1. Minimizing Financial Losses Associated with Fraud

As we navigate the economic impact of the pandemic and the ongoing war in Ukraine, fraud remains a mounting concern. Data from last year is still being tabulated, but estimates show fraud was responsible for $10 billion in losses, a 50% increase from 2021.

The year ahead promises more threats to vulnerabilities in AML solutions. Real-time insights enable institutions to detect suspicious behavior before it impacts your bottom line.

If one of your customers conducts repeated transactions under the $10,000 threshold for reporting, your AML solution will elevate that anomaly for your team’s review. The advanced analytics capabilities of real-time AML also allow you to create on-demand visualizations that identify suspicious activity such as multiple transactions in a given area by a single customer.

Real-time insights offer greater visibility into customer behavior both during onboarding and at the transaction level. By enabling greater Know Your Customer (KYC) capabilities in a faster, more efficient way, your institution sees a greater ROI from its AML program.

2. Maintaining Compliance with Financial Regulations

Small- to midsize banks, gaming companies, and other financial institutions face a constant challenge to maintain regulatory compliance. An AML solution doesn’t just need to remain current with bug fixes and maintenance to function at a high level. It also needs regular updates with the latest compliance requirements specific to your region.

The right IT partner will customize and support a real-time AML solution to suit your institution’s needs. Rather than dedicating full-time resources to more AML investigators, you gain an expert team to manage your solution. That way, your institution can focus on compliance efforts and filing suspicious activity reports (SARs) with authorities.

Along with protecting your institution against costly fines, you secure your reputation in the marketplace as well.

3. Increasing Consumer Trust by Safeguarding Your Institution’s Reputation

Failing to maintain an effective AML solution comes at a high price. Last year, Wells Fargo, Danske Bank, and USAA were among the institutions to receive hefty fines for compliance violations. In 2021, regulators levied more than $5 billion in fines.

However, fines don’t constitute the most damaging impact of compliance violations. The greater loss is felt in the institution’s ability to attract and retain customers as a result of these fines.

At a time when data security is a primary concern for businesses and individuals alike, your customers are trusting your organization with their most vital assets. Your bottom line may not be impacted if you skimp on an AML program. But if your customers recognize your institution is susceptible to fraud after incurring hefty fines, they’re likely to take their business elsewhere.

4. Enhancing the Customer Experience

Along with recognizing their personal data is secure, customers benefit when your institution incorporates real-time insights into its AML solution. By reducing the inconveniences associated with financial crimes or unnecessary holds on accounts to investigate false positives, your customer enjoys a more streamlined experience.

At Zencos, we specialize in implementing AML solutions that automate fraud detection processes. Once we have all the data points that are most important to your institution and its industry, we apply the analytics and rules to create a cloud-enabled insight engine to identify fraud and suspicious activity.

From there, it’s an exercise in quarterly tuning to accommodate new customers and new data. With our real-time AML solution, we’ve reduced the false positive problem for several organizations by more than 70%.

5. Improving Decision-Making in Response to Customer Behavior

Real-time insights offer your institution the opportunity to gain more visibility into customer behavior. Once you’ve established a data-driven mindset in your organization you gain vital insights into their deposits, transfers, and withdrawals that inform your decision-making.

Along with the ability to provide strong customer service, real-time insights offer greater visibility into customer habits. Then, by applying advanced analytics techniques, you can assess customer risk levels and establish expectations for their future activity.

Real-Time AML Insights Requires a Data-Driven Organization

To gain the real-time capabilities your institution needs, you must address the specific technical requirements that suit your organization. However, to create a data-driven culture, you need the support of three pillars: Your data, its architecture, and the analytics.

The journey toward aligning all three pillars can be daunting. It requires the right tools, but also the proper training as well as regular collaboration between internal stakeholders such as compliance, risk management, and IT. But you don’t need to start this process alone.

If you feel like it’s time your organization reaps the rewards of real-time AML insights, let’s talk. We’ll make a plan that’s right for you – wherever your organization stands on that journey.

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